Putin is visiting the country for the first time since Xi became head of state last year and the trip could see a huge and long-awaited natural gas deal finally signed.
"Russian President Vladimir Putin arrived in Shanghai early Tuesday to start his state visit," China's official news agency Xinhua said.
Russia's relations with the United States and European Union have plunged to a post-Cold War low in recent months over its seizure of Crimea and Western accusations Moscow is fomenting unrest in the east of Ukraine.
Putin is due in China's commercial hub Shanghai for an Asian security summit and the two countries will also show off their military prowess as 14 ships begin week-long drills in the East China Sea.
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"For the Russians, it is much more about showing 'We have other options... We've got a very strong relationship with China'," said Raffaello Pantucci, senior research fellow at the Royal United Services Institute for Defence and Security Studies.
The two countries are both veto-wielding members of the United Nations (UN) Security Council, are regularly criticised by western human rights groups, and have often worked together to counter the United States on a range of issues.
Speaking on the eve of his visit, Putin told Chinese media that ties were at the "highest level" in history.
The naval show of force will include "live fire" drills and Pantucci said: "The Chinese are much more agitated about what happens on the sea and one sees support there from Russia."
Relations between Beijing and Hanoi have worsened after China's move earlier this month to send a deep-water oil drilling rig into contested waters in the South China Sea, sparking violent anti-Chinese protests in Vietnam which saw two Chinese killed.